"I can tell you the consoles we're making today have lower-heat chips and better cooling, and we're seeing fantastic quality in those consoles today," said Greenberg to GameSpot. "That said, I know people have had issues with systems, which were bought earlier in the life cycle, and that's part of the reason why we implemented our unprecedented three-year warranty for anyone who gets the three red-ring flashing light error or the E74 error."

Microsoft extended the warranty on Xbox 360 launch consoles to three years in 2007, a move that cost the company $1 billion.

"I think we've made it clear we stand by the quality of our product, and we will make it right by fixing the problem at no extra cost to you," he said. "But at the same time, we've been working hard to make improvements in the products we're currently making, so I really feel like most of this is well behind us."